VRSN reported second-quarter 2023 adjusted earnings per share EPS of $1.79, which beat the Zacks Consensus Estimate by 5.3%. The company had reported EPS of $1.54 in the prior-year quarter.

Revenues jumped 5.7% year over year to $372 million but missed the Zacks Consensus Estimate by 0.01%.

VeriSign marginally narrowed the upper end of its revenue guidance. Management now expects 2023 revenues to be between $1.49 billion and $1.50 billion compared with the earlier guided range of $1.490-$1.505 billion. VRSN’s domain name base’s growth is now expected to stay flat or rise 1% due to continued uncertainty and weakness related to China. Earlier, the domain name base’s growth was projected to rise 0.5% to 2.25%.

VRSN continues to hold a monopoly position as the registry for .com and .net domains and is growing its FCF steadily.  But growth is tepid, the company pays no dividend, and at a 30+X valuation, there are likely better opportunities to allocate capital at these levels.  We are not rushing to sell, but will begin to look for other opportunities.